New research from MYOB has shown that cloud-computing is raining success down on SMEs. The research shows a pattern of positive financial and operational results. The MYOB research also forecasts more of the same on the horizon.
One key finding was that those using cloud technologies for business were 53% more likely to see revenue rise in the past year, making cloud computing the object of envy for SMEs not already using the technology.
MYOB, which offers its own suite of cloud solutions, commissioned independent market research firm Colmar Brunton to conduct a nationally representative survey of more than one thousand SMEs.
Results found that only 14% of responding companies were using cloud services for business, while 79% were not using it, and another 8% did not seem to have a clue about cloud computing.
MYOB CEO Tim Reed says, “Despite the technology industry’s best efforts to teach others about the concept of cloud computing, our research shows a disconnect between SME cloud usage and their {the companies} understanding of it. I question whether we need to rethink our educational direction when encouraging their move to the cloud.”
Respondents’ gap in understanding the difference between the cloud and a cumulus cloud, brings into question whether their sector’s needs are aligned with the technology industry’s educational desires.
“Four-in-five say they don’t use the cloud for business. This is surprising given the prolific use of internet banking and email, to give straightforward examples. Many more business operators leverage cloud technology than they give themselves credit for, they just don’t realize.”
“The key to encouraging mass adoption of newer and more advanced cloud products and services is to advocate the productivity and financial benefits to a much greater extent than the technology behind it. Put simply, the cloud is already changing business for the better – it has been doing so for years – and is now providing access to even more powerful business tools that improve the way we work.”
“It is really encouraging to see our research uncover the significant business performance results of those using cloud technologies in business. The mobility, flexibility and scalability benefits are life-changing for some people.”
“Technology innovators and early adopters already get it; but cloud solutions are now ready for the mass market. Our clients and partners, many of whom already use cloud solutions, often tell me their main concern is how a technology will help them be more competitive and help make business life easier. I liken it to smartphones. Do most people care about how they work, or do they care about the business benefits a smartphone brings?”
How the cloud brings in the bucks
Mr. Reed says, “The advantages of using cloud computing for business came through loud and clear in MYOB’s research. We found those doing so were 53% more likely to see a revenue rise last year. 26% of respondents who said they were using the cloud saw a {sic} revenue rise, compared to 17% of those who said they were not using it.”
There were numerous financial and operational result wins for cloud users. They were also more likely to:
- Have more sales/work than usual in their 3-month pipeline: 55% versus 25% of those not using the cloud
- Intend to grow their number/range of products or services in the next year: 48% versus 24%
- Expect their revenue to rise in the next year: 44% versus 26%
- Intend to increase their prices and margins on products/services sold this year: 37% versus 25%
- Intend to increase staff numbers this year: 35% versus 15%
- Expect the economy to improve within 12 months: 34% versus 18%
- Record revenue increases in the last 12 months: 26% versus 17%.
The shapes in the clouds
The most popular reason for respondents using cloud computing was the ability to access data from whatever location they wanted (42%) followed by being able to have their team members work remotely (28%).
26% said a major reason for their cloud usage was to reduce the number/range of IT issues they have to deal with personally, while 23% also said they used it because their data was better protected and safer online on external servers.
Mr. Reed asserts, “Cloud usage can provide a serious competitive advantage. Increasingly, businesses have teams on the road, in the office and working at home. The power of the cloud provides the freedom to work anywhere at any time, to be with your customers, partners and suppliers while still enjoying a connection to the office.”
“Plus, the secure gateway offered by trustworthy cloud providers means you can authorise others to access your business data as you access it. This eliminates the need to transmit data in physical forms to, say, your accountant or book keeper via CD, USB, email and other less secure means.”
Why run for the hills?
SMEs not using cloud computing for business were asked why not, uncovering these top five mental hurdles:
- 27% said they did not know enough about the issues to make the right decision
- 26% were unsure of the safety in storing their data in servers overseas
- 22% said it is of interest, but there are more important other business priorities to take care of first
- 21% were unsure their data would be as secure on servers other than their own
- 17% said they were not tech-savvy enough to feel confident to even start looking at the issue.
Mr. Reed said, “Next generation cloud technology can make it easier for SMEs to embrace the cloud. It not only enables you to access your business data online, you can access the same file offline because the cloud and local files are synced. You get the benefits of cloud with that of a desktop application – the best of both worlds.”
Paying it forward
To find out whether potential cloud-related business cost savings could flow to consumers, MYOB asked, “If you could reduce your business administration costs in any way, how likely would you be to pass on the savings to customers?” – One third (33%) said they were quite likely (27%) or very likely (6%) to pass on savings.
Future forecast is for more cloudy predictions
Across the survey’s many cross-breaks, business operators most likely to say they used cloud computing included:
- Generation Y (28%)
- Businesses with a website (23%)
- Those running start-up businesses (23%)
- Those in business, professional & property services businesses (22%)
- Metropolitan-based businesses (21%)
- Businesses whose revenue had increased in the last 12 months (20%)
- Sole traders (15%).
Cloud computing usage in Australia
On average, 80% of small and medium operators across the mainland states reported not using cloud for business. New South Wales had the highest proportion of users (15%) while Western Australia had the lowest (9%).
In terms of the top drivers nationally, the ability to work on data from any location appealed to Victorians the most. Enabling staff to work remotely was most appealing in New South Wales. With the top barriers, New South Wales had the highest proportion of respondents who said they did not know enough about the issues to make the right decision and they were also the most concerned about the safety in storing data in servers overseas.
What about you?
So what about you? We’d love to see some comments around how the Anthill community is using cloud computing. Post a comment below and tell the community how your company is integrating cloud services.
